Message From the Marketing Director

Message from the Marketing Director

 Inky Eating 0613



Look into my eyes.  You will do my bidding.  Rich wants me to talk to you about his upcoming seminars.  But those dates are posted on the newsletter front page or you can call (571) 208-0425 for more information.  Your obeisance and acquiescence are needed for a much more urgent matter.

Look at my plate.  Meow Mix, really?  I demand more substantive fare.  Look to your left.  No, your other left.  You should see a shovel in the corner.  If you don’t have a shovel, then shame on you!  How did you think you could effectively do my bidding without a shovel?!

[Sigh]  Alright, you slackers can use your hands instead.  Go out to your nearest field and begin “shoveling” dirt near trees or leaf piles.  Anywhere rodents are likely to congregate and cower.  I’ll be over at a time of my earliest convenience to check your progress.  If you do a good enough job finding dinner, I may split the kill with you.  Go forth!

Your Superior,


P.S.    Lowe’s has shovels.  Just sayin’.

Why You Should Consider Trust Planning

Why You Should Consider Trust Planning

By Richard E. Phillips


When most people think about estate planning (if they think about it at all), most people believe their best or only option is a will combined with some joint tenancy or transfer-on-death arrangements for their financial accounts.  However, there is a superior method to estate planning that’s existed for several hundred years and allows you to peacefully and privately transfer your wealth after you die to your loved ones.  This method is an estate plan built around a revocable living trust.

Like a will, a trust is a legal document which addresses how your estate will be administered and disposed of after you die.  However, there is an important difference.  A will is a testamentary document by you that does not take effect until after you pass away.  Until then, it does nothing for your estate.  Furthermore, after you die, the will must be qualified publicly before your local probate court as part of a potentially very expensive government administration.

Unlike a will, a trust is a private contract between you as creator of the trust and the one who is re-titling your assets into the name of your trust (very important!) and you as the manager of the trust assets.  The trust is effective immediately upon you signing your trust agreement and will successfully manage your estate upon your incapacity or death, so long as your assets remain titled in the name of your trust or the trust is designated as a beneficiary of your assets.

The main advantages of estate planning through a revocable living trust over other basic estate planning options are the following:

  1. Avoids probate.
  2. Privacy.
  3. Incapacity Management.
  4. Maximizes Death Tax Exemptions.
  5. Flexibility.

Avoids probate.  Since a trust is a private contract which determines the terms of how its assets are to be managed upon your incapacity and death, there is no need to have a third party bureaucratic entity administering your estate.  The main reason for the probate process is to change title to property from a dead person’s name to that person’s living beneficiaries.  With a trust, however, you already retitled your assets during your lifetime out of your individual name and into the name of your trust.  Thus, when you die there are no assets owned in your individual name.  Therefore, your estate has no reason to go through probate.

Privacy.  Because a trust is a private document which is administered privately, there is no need of the public process of probate.  No need to have your assets sold at a public estate auction nor will your loved ones be bothered by people looking to take advantage of your estate because they could review your will at the probate court.

Incapacity Management.  If you have only a simple will drafted, but you become incapacitated during your lifetime, who will handle your financial affairs for you?  If you don’t have an appropriate power of attorney document in place for such a contingency, there would have to be a guardianship proceeding, known as “living probate,” where the court (not you, not your family) decides who will manage your affairs for you.  With a trust, however, you can appoint the person who not only will manage your estate after you die, but also in case of your mental incapacity.

Maximizes Death Tax Exemptions.  Death taxes have been a plague on transferring wealth for decades.  But the fallout from possible death taxes worsens when a family estate plan does not take this issue into account.  Every individual is entitled under the law to exempt up to a certain amount of his or her estate after death from the federal death tax.  Most couples, however, unwittingly forfeit the use of the first spouse’s death tax exemption by either electing to use the unlimited marital deduction at the first spouse’s death or deciding that it’s best to own joint property in both their names as joint tenants with right of survivorship.

Unfortunately, when a couple owns property together as joint tenants with right of survivorship (or tenancies by the entirety with right of survivorship), the right of survivorship provision applies immediately and transfers the entire property interest into the surviving spouse’s estate.  Thus, the first spouse to die’s death tax exemption will not apply to those assets no longer in his or her estate.  A trust, however, is a very flexible agreement that can allow the property of the trust to be allocated between both spouse’s estates and maximize the use of both spouse’s death tax exemptions.

Flexibility.  As you have read, a trust is a versatile and flexible document.  This flexibility is further apparent in how it can work with your transfer-on-death (TOD) accounts in leaving a lasting legacy to your children and grandchildren.

For example, suppose you have two adult children.  One is very responsible, but the other is financially irresponsible.  Typically, most parents designate their children individually as the beneficiaries of their financial accounts without considering how they can protect the wealth they’re leaving from a child’s creditors or future ex-spouse.  Instead, you can establish trusts in your revocable living trust agreement for each of your children (and potentially grandchildren) which take effect on the surviving spouse’s death.  The share you leave to each child resides in the trust created for them and protects the assets which reside in the trust from that child’s creditors or ex-spouse.  It just depends on the terms you want drafted.  Therefore, you designate your trust as the beneficiary of your TOD accounts instead of the children in their individual names.

You can provide peaceful wealth preservation for your family and you don’t have to a Rockefeller or a Gates to afford this type of planning or take advantage of what this kind of estate planning offers your loved ones.